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Antero Midstream (AM) Gains 8.8% Despite Q1 Earnings Miss

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Antero Midstream Corporation (AM - Free Report) gained 8.8% despite reporting weak first-quarter 2022 earnings on Apr 27. It seems that investors cheered the company’s de-risked growth outlook that is being backed by its strong focus on organic investments in critical infrastructure.

Antero Midstream reported first-quarter adjusted earnings per share of 19 cents, missing the Zacks Consensus Estimate and declining from year-ago quarter earnings, both being 21 cents.

Total quarterly revenues of $218 million surpassed the Zacks Consensus Estimate of $216 million. The top line, however, decreased from $224 million in the year-ago quarter.

Antero Midstream’s weak earnings can be attributed to lower freshwater delivery volumes. This was partially offset by higher average daily compression volumes.

Operational Performance

For first-quarter 2022, average daily compression volumes were recorded at 2,816 million cubic feet (MMcf/d), up from the year-ago level of 2,706 MMcf/d. On a per-Mcf basis, the compression fee was 21 cents, improving from the prior-year quarter’s 20 cents.

For the reported quarter, high-pressure gathering volumes totaled 2,878 MMcf/d, up from the year-ago period’s 2,812 MMcf/d. On a per-Mcf basis, the average gathering high-pressure fee was 21 cents, improving from the prior-year level of 20 cents.

Low-pressure gathering volumes averaged 2,930 MMcf/d, up from the first-quarter 2021 figure of 2,853 MMcf/d. On a per-Mcf basis, the average gathering low-pressure fee was 34 cents, higher than the prior-year level of 33 cents.

Freshwater delivery volumes were at 87 MBbls/d, down 16% from the prior-year level of 104 MBbls/d. On a per-barrel basis, the average freshwater distribution fee was $4.07 per barrel in the reported quarter, up from $3.97 in the prior-year quarter.

Operating Expenses

For first-quarter 2022, direct operating expenses of Antero Midstream were recorded at $42 million, up from $39.3 million a year ago. G&A expenses remained almost flat at $17.9 million.

Antero Midstream’s total expenses for the quarter were $89.3 million, decreasing from the first-quarter 2021 levels of $90.5 million.

Balance Sheet

As of Mar 31, Antero Midstream had no cash and cash equivalents. As of the same date, Antero Midstream had $3,133.2 million of long-term debt. It had a long-term debt to capitalization of 58.1%.

Other Details

Antero Midstream’s free cash flow after dividend payments was a $37.6-million deficit in the first quarter.

Capital expenditure (accrual basis) of Antero Midstream was recorded at $94.7 million. Net cash from operations was $185 million in the reported quarter.

Zacks Rank & Stocks to Consider

Antero Midstream currently carries a Zacks Rank #3 (Hold). Better-ranked players in the energy space include ConocoPhillips (COP - Free Report) , Marathon Oil (MRO - Free Report) and Occidental Petroleum (OXY - Free Report) . All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Considering production and reserves, ConocoPhillips is one of the leading exploration and production players in the global market. ConocoPhillips has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days.

In 2022, ConocoPhillips is likely to see earnings growth of 140.1%.

Marathon Oil is a leading oil and natural gas exploration and production company. Marathon Oil has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days.

In 2022, Marathon Oil is likely to see earnings growth of 197.5%.

In the United States, Occidental Petroleum is among the largest oil producers. Occidental Petroleum has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days.

In 2022, Occidental Petroleum is likely to see earnings growth of 264.3%.